Rupee hits new peak on good inflows

Rupee hits new peak on good inflows


Mumbai: The rupee touched a near nine-and-a-half-year peak at 39.63 against the dollar soon after opening of trade on 26 September, buoyed by heavy portfolio investments into the record breaking equity markets.

Later, it was quoted slightly better at 39.70/71 a dollar from overnight close of 39.7350/7450 in late morning deals.

In active trade at the Interbank Foreign Exchange (Forex) market, the local currency opened strong at 39.68/70 a dollar.

Firming local stock markets and weak dollar overseas pushed rupee upwards to the new peak. The Indian unit breached the previous peak of 39.65 registered on 14 April 1998 and is currently moving towards 39.4090 a dollar recorded on 8 April 1998.

In morning deals, the benchmark Sensex was up by 125.53 points to cross 17K-mark for the first time in the history.

However, dollar buying by oil refiners and other importers for their month-end requirements later pulled rupee back to a low of 39.73 before being quoted at 39.70/71 a dollar in late morning trade.

According to forex dealers there was some intervention by the central bank to prevent the sustained surge in the rupee value to protect the exporters’ competitiveness.

The dollar fell back to record low against the euro in New York last night.

Meanwhile, Foreign Institutional Investors (FIIs) picked up shares nearly worth $2 billion since 19 September and their total investments in equity markets crossed $11 billion this year so far, surpassing the previous record of $10.79 billion in 2005.